Licenses and Taxes

This week I explored licenses and taxes associated with creating a website to sell products or services. First the future owner has to decide what kind of business they want to set up, i.e., manufacturing, sales, services, etc. I chose retail sales for an online store. Next a decision had to be made if I were to hire employees or be an individual contractor (I chose the second one). The next decision was to choose what type of business entity out of these choices:  Sole Proprietorship, Limited Liability Partnership, S-Corporation, C-Corporation, Non-profit Corporation, Limited Partnership, General Partnership, or Professional Service Corporation.  (I chose Sole Proprietorship). Since I would make retail sales, I need to obtain a sales and use tax permit in Idaho. An Assumed Business Name had to be registered with the Idaho Secretary of State’s office.  The city clerk’s office of where I lived needed to be contacted to determine if I needed a business license which I did not need. I found out that if my business is in Idaho, I needed to obtain a regular seller’s permit, collect sales tax from Idaho buyers, and remit the taxes.  I found out that I do not need a seller’s permit since I am only with a marketplace facilitator (Amazon.com) which collects and sends in the taxes due to Idaho.